M&T Bank credits changes for surge in its SBA-backed loans

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SYRACUSE — M&T Bank is crediting several changes it made to its small-business lending model for the jump in its March loan-approval volume in the Syracuse district of the U.S. Small Business Administration (SBA). M&T Bank approved 49 SBA-backed loans in the agency’s (7a) program during March, which almost equaled the 51 such loans it […]

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M&T Bank approved 49 SBA-backed loans in the agency’s (7a) program during March, which almost equaled the 51 such loans it approved from October through February — the first five months of the 2016 fiscal year.

In all, M&T Bank has made 100 loans in the 7(a) program, totaling $6.8 million, in the first half of the current fiscal year, according to SBA figures.

The 7(a) loan program is the “most widely used,” access-to-capital SBA program, with “flexible” use of proceeds and a loan maximum of $5 million, the agency says.

The SBA also has a 504 loan program, which offers long-term, fixed-rate financing for major assets such as land, building, and equipment, with a loan maximum of $5 million.

The SBA’s Syracuse district includes 34 counties in Central and Eastern New York.

M&T Bank “reassessed and lowered and streamlined” its processes and minimum dollar threshold, says Lee DeAmicis, regional business banking manager who works in the bank’s Syracuse office. He spoke to CNYBJ on April 22.

DeAmicis says M&T assesses the marketplace to determine what the needs are, indentifying what he called “microbusinesses,” or those companies that generate revenue of less than $1 million per year.

M&T determined it could meet a need for small-business lending in the SBA Syracuse district and “streamlined” some of its processes.

“We’ve lowered our threshold of the minimum loan size, particularly [commercial] lines of credit, from $25,000 to $5,000, and we added some staff to make sure we could get those increased volumes through the pipeline,” says DeAmicis.

Besides the reduced loan minimum for its SBA-backed loans, M&T also made the application process “easier” for the small-business market, streamlining the initial paperwork the bank needs to consider such loans.

The banking company also added staff to its Buffalo office to handle the small-business loan processing and underwriting functions.

Another change, DeAmicis notes, targeted M&T’s branch managers.

“We put in place a focus for them to go out and work with their small-business customers and prospects to bring this product to the marketplace,” he says.

M&T in March approved SBA-backed loans for some smaller trucking companies and retail operations.

“Startups are very risky and that’s where we often use the SBA to help offset the riskiness of industries like that,” he says.

Contact Reinhardt at ereinhardt@cnybj.com

NBT profit rises nearly 4 percent in first quarter

Banks & Credit Unions, Insurance & Financial Services, Law, Accounting & Taxes, Subscriber Only

NORWICH — NBT Bancorp Inc. (NASDAQ: NBTB) reported net income of $18.9 million, or 43 cents a share, in the first quarter, up 4 percent from $18.2 million, or 41 cents, in the year-ago quarter on the strength of loan and deposit growth. “Our first quarter 2016 results demonstrate our strong financial performance and sustained

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“Our first quarter 2016 results demonstrate our strong financial performance and sustained favorable trends in organic loan and deposit growth and asset quality indicators,” Martin Dietrich, NBT’s president and CEO, said in its earnings report issued on April 25.

NBT Bancorp, holding company for NBT Bank, reported net interest income of $64.6 million in the first quarter, up almost 4 percent from $62.2 million in the year-earlier period.

Its fully taxable equivalent net interest margin was 3.47 percent for the three months ending March 31, 2016, up from 3.42 percent last quarter but down from 3.60 percent for the first quarter of 2015. The increase from the previous quarter was driven by a rise in yields on loans, partially offset by slightly higher costs of interest-bearing deposits, NBT reported.

NBT produced noninterest income of $28.4 million in this year’s first quarter, up almost 7 percent from the same quarter in 2015.

Noninterest expenses for the three months ended March 31, 2016 totaled $58.2 million, up from $57.7 million in the first quarter of 2015.

Asset quality
NBT reported net charge-offs of $4.8 million in the first quarter, up from $4.6 million for the same period in 2015. The banking company recorded a provision for potential loan losses of $6.1 million in the first quarter, up from $3.6 million in the first three months of last year. NBT said in its earnings report that it did so primarily due to loan growth.

The ratio of annualized net charge-offs to average loans for the first quarter of 2016 was 0.33 percent, compared with 0.34 percent for the first quarter of 2015.

The ratio of nonperforming loans to total loans was 0.69 percent as of March 31, 2016, down from 0.85 percent a year prior.

NBT said past-due loans as a percentage of total loans came in at 0.51 percent as of this March 31, compared to 0.56 percent on the same date in 2015.

The banking company’s allowance for loan losses totaled $64.3 million at the end of this year’s first quarter, compared to $65.4 million a year earlier.

NBT Bancorp had total assets of $8.5 billion as of March 31, 2016, up by $210.3 million, or 2.5 percent, from the end of 2015. It had $6 billion in loans and $6.9 billion in deposits, as of the end of the first quarter.

Stock-repurchase program
NBT said it repurchased more than 675,000 shares of its common stock during the first quarter of 2016 at an average price of $25.45 per share under a previously announced stock buyback plan. As of March 31, it had more than 277,000 shares available for repurchase under this plan, which is set to expire at the end of this year. On March 28, the NBT board of directors approved a new program for the banking company to repurchase up to an additional 1 million shares of its shares outstanding. That plan expires at the end of 2017.

NBT Bank has 155 branches in six states — New York, Pennsylvania, Vermont, Massachusetts, New Hampshire, and Maine. It ranks second in deposit market share in the 16-county Central New York market, with a 10 percent share of all deposits, according to the latest FDIC data.

Contact Rombel at arombel@cnybj.com

Community Bank Q1 profit, revenue rise on increased assets from Oneida Financial deal

Banks & Credit Unions, Insurance & Financial Services, Law, Accounting & Taxes, Subscriber Only

DeWITT — Community Bank System, Inc. (NYSE: CBU) reported net income of $24.4 million in the first quarter, up 9.4 percent from $22.3 million in the year-ago quarter, as it benefitted from the assets it acquired in its $158.5 million acquisition of Oneida Financial Corp. Earnings per share at Community Bank rose to 55 cents

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Earnings per share at Community Bank rose to 55 cents in this year’s first quarter from 54 cents in the first quarter of 2015, it reported on April 25. The banking company incurred about $100,000 and $400,000 of acquisition expenses in the first quarter of 2016 and 2015, respectively.

“Our improved first quarter operating results were driven by solid earning-asset growth, a continuation of excellent credit quality, and a full quarter impact of the Oneida Financial transaction completed in late 2015,” Mark E. Tryniski, president and CEO of Community Bank, said in the bank’s earnings report. “A productive start in both our lending and core funding activities in the first quarter of 2016 positions us well for the balance of the year.”

The acquisition of Oneida Financial, which closed on Dec. 4, 2015, extended Community Bank’s Central New York service coverage by expanding its market presence in the Syracuse and Utica–Rome metro areas and added to its insurance, benefits administration, and wealth management product and service offerings, he said.

Community Bank generated $105.2 million in total revenue in this year’s first quarter, up more than 18 percent, over the prior-year quarter, as it benefitted from a full quarter of business from the acquired Oneida Financial, parent of Oneida Savings Bank and OneGroup. Specifically, Community Bank saw a 14.2 percent increase in average earning assets and growth in noninterest income from acquired and organic sources. That more than offset its 16 basis-point reduction in net interest margin from the year-ago quarter.

Community’s average loan balances grew by $622 million, or nearly 15 percent, while average loan yields declined 12 basis points year-over-year to 4.33 percent. That resulted in a $6.1 million increase in quarterly loan interest income. Community Bank said it acquired about $400 million in loans in its Oneida Financial deal.

Wealth management and insurance revenue at Community Bank soared by $6.5 million, or 146.5 percent, in this year’s first quarter compared to the first quarter of 2015, mainly because of the Oneida Financial acquisition.

The enlarged Community Bank generated first-quarter operating expenses of $67.7 million, up $11.7 million, or nearly 21 percent, from the year-earlier period. That reflected a full quarter of operating expenses from the Oneida Financial business units it added. Salaries and employee-benefit costs increased by $8.1 million, or 26 percent, compared to the first quarter of 2015 for the same reason.

Community Bank said it took a provision for loan losses of $1.3 million in the first quarter, up $0.7 million from the first quarter of 2015, reflecting quarterly net charge-offs of $1.1 million and organic loan growth of nearly $20 million during the quarter.

The banking company’s effective tax rate for the first quarter of 2016 was 32.5 percent, up from the 31 percent rate in the year-earlier period. The majority of that increase resulted from higher New York State taxes based upon the banking company’s increased consolidated asset size, as well as a higher proportion of its income coming from fully taxable sources, Community Bank said in the earnings report.

As previously announced in December, Community Bank’s board of directors approved a stock-repurchase program authorizing the repurchase of up to 2.2 million shares of the banking company’s common stock during a 12-month period starting Jan. 1, 2016. Community Bank said it did not buy back any shares under this authorization in the first quarter.

Contact Rombel at arombel@cnybj.com

M&T appoints René Jones to expanded role, names CFO successor

Banks & Credit Unions, Insurance & Financial Services, Law, Accounting & Taxes, Subscriber Only

M&T Bank Corp. (NYSE: MTB) announced that Vice Chairman René F. Jones has taken on new managerial responsibilities, effective May 2. In addition to continuing oversight of the bank’s Treasury function and Wilmington Trust division, he adds two new business lines — mortgage and consumer lending. “As our chief financial officer, René has helped guide

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M&T Bank Corp. (NYSE: MTB) announced that Vice Chairman René F. Jones has taken on new managerial responsibilities, effective May 2.

In addition to continuing oversight of the bank’s Treasury function and Wilmington Trust division, he adds two new business lines — mortgage and consumer lending.

“As our chief financial officer, René has helped guide M&T successfully through one of the most challenging 10-year periods in our company’s history, and today we’re stronger than ever,” M&T Chairman and CEO Robert G. Wilmers said in a news release.

Jones joined M&T in 1992 and has held a series of management positions in its finance division. He was promoted to CFO and joined the bank’s management group in 2005, and was named vice chairman in January 2014.

M&T also announced that Darren J. King, executive VP, will become the banking company’s new CFO.

As head of M&T’s retail and business banking divisions, King has been responsible for more than 6,700 employees, 800 branches, and 1,600 ATMs serving 2.1 million households, the bank’s news release noted.

“Both as the leader of one of our largest and most important businesses and as a member of the bank’s management group, Darren has demonstrated a deep understanding of the banking business, a keenly analytical mind and a strong strategic vision of M&T’s role in our communities and in our industry …,” said Wilmers.

King joined M&T in 2000 and was named to the management group in 2010.

M&T Bank, headquartered in Buffalo, operates banking offices in New York, Maryland, New Jersey, Pennsylvania, Delaware, Connecticut, Virginia, West Virginia, and the District of Columbia. Trust-related services are provided by M&T’s Wilmington Trust-affiliated companies and by M&T Bank.

M&T is ranked number one in deposit market share in the 16-county CNY area with a 19.3 percent share of all market deposits, according to the latest FDIC data.

Contact The Business Journal News Network at news@cnybj.com

Tinker Your Way to Success

Business Mentors, Subscriber Only

It took a long time, but it had to happen. and it did. Finally, there are schools, summer camps, and weekend experiences where kids learn how to tinker. This is far from what some call “futzing around” and others label wasting time. It’s serious business. Tinkering was once a valued profession. Adept at analyzing and

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Tinkering was once a valued profession. Adept at analyzing and solving problems, tinkerers tackled anything that needed fixing. They were skilled problem-solvers who figured out what was wrong with equipment and machinery and fixed it, as well as found ways to improve their performance.

Tinkering is anything but a lost art. Spotting and dissecting problems and coming up with workable solutions is an enormously valuable business skill — one that requires a lot of tinkering.

At its core, tinkering is getting things right before we make needless costly, and perhaps disastrous mistakes. It’s all about insight and creativity. And here is what it takes.

Nothing is ever good enough
Tinkering is the attitude that good enough doesn’t cut it. Whatever it is, it can be better, whether it’s writing a letter, email message, report, memo, proposal, or presentation, dealing with a problem, responding to inquiries, answering customer concerns, creating a sales plan, or understanding prospects.

There are no exceptions. Good ideas fail because they’re rushed and not thought though. Proposals are rejected because they are superficial. New initiatives are quickly abandoned because they’re full of holes. All are victims of the pervasive “get-it-done and out the door” mindset.

Take on challenges
The one opportunity that overshadows everything else in any job is routinely ignored or passed up. And that’s taking on challenges, which is a code word in business for solving problems.

If you ask most people to spell challenge, they’ll say, “T-R-O-U-B-L-E.” They run the other way from challenges, avoiding them at all costs. As they see it, challenges conger up images of long hours, too much work, getting blamed, and failing. Just say the word and they run and hide behind claims of being too busy or having to walk the dog after work. That’s all good news because it opens up enormous opportunities for those who dare to raise their hands and say, “I’ll work on that.”

Get to the bottom of things
Understanding how things fit together, making connections, and uncovering what’s missing goes beyond superficial and incomplete answers. Since many of us think that may be a good idea, but it takes too much time, so why bother. And that’s why “Googling” is the accepted standard for research. How many of us are interested in knowing whether something is fact or opinion? How many know the difference or even care?

The New York Times Magazine described how Kent Clizbe, a former CIA officer and intelligence contractor, went about the arduous exposé of a daring media con man as “an unrelenting compulsion to get to the bottom of things … He has a perpetual need to turn everything inside out …”

Tinkering gets us to the bottom of things, and that’s what it takes to innovate, break down barriers, and make a difference on or off the job.

Stop making mistakes
Is that too much to ask? Of course there are “circumstances beyond our control,” but most often, mistakes result from moving too quickly.

Steve Jobs tapped Ron Johnson to develop the now wildly successful Apple retail stores. Then, based on this success, he was picked to work his magic on saving the legendary J.C. Penney stores. Instead, he unleashed tornado-like disruption and was quickly blown away.

Now, Johnson is launching a new venture and told USA Today, “The mistake I made was trying to change things too fast. I’m going back to what I learned at Apple, which is that there’s no such thing as an overnight success.”

No one wants to make mistakes, yet they still happen. New executives arrive, for example, with a “Here’s what we’re going to do to make us successful” message. This is always a mistake, because this is the time for tinkering, for learning how the place operates, spotting problems, and coming up plans for improvement that brings everyone on board.

“The mistake I made was trying to change things too fast” is good advice.

Take control
Those who practice the art of tinkering know its secret. They’ve learned how to take control of their lives. They don’t cower, complain, or quit in the face of the endless obstacles they face every day. They’re always looking for ways to make something better.

Amazon makes customers happy with earlier than expected deliveries
Honda created excitement by offering a complimentary pair of quality, limited-edition driving shoes with each new Civic
Sunoco service station makes follow-up phone calls to customers after working on their car
Medical office amazes patients with its “no waiting” policy
Company CEO knows the cleaning person’s name and always says hello

What does it take to make good things like this happen? Just a little tinkering and asking one question: “What if we…?” Every company needs tinkerers — the more the merrier. They get a kick out of making the place better.

To encourage tinkering, it might be a good idea to give a “Tinkerer of the Month Award” and share tinkering success stories. At a time when so many workers feel undervalued, we should let them tinker and see what happens. It could be just the way to turn a lot of minds into suggestion boxes bursting with new ideas.

John Graham of GrahamComm is a marketing and sales strategist-consultant and business writer. He publishes a free monthly eNewsletter, “No Nonsense Marketing & Sales Ideas.” Contact him at jgraham@grahamcomm.com, (617) 774-9759, or johnrgraham.com

It’s time to get rid of the IRS

Opinion, Subscriber Only

Tax deadline day has passed. Whew! To honor that glorious day, here is a request: All in favor of destroying the IRS, please raise your hand. Wow, look at that sea of hands. Some of you have raised both hands. I don’t blame you. Especially those who are surrendering. Getting rid of the IRS is

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Getting rid of the IRS is a great idea. From the many hands I see, I guess you agree. Few in Washington would have the guts to do it. Or even propose it. But it is a good idea.

Yes, Senator Ted Cruz, a presidential candidate, suggests getting rid of the IRS. But most Americans don’t take the idea seriously. They figure it cannot be done.

That is a pity, because the IRS is a curse on this nation. A blight. For many, it is a monster that hounds and harasses them. For others, it is merely a migraine. Yet we don’t need it. We truly do not.

We have this immense economy. We need to bleed it to get money to run the country. So we sic leeches to the area of the economy known as income. Hence our income tax.

We could sic leeches on other parts of the economy — instead of on incomes. That would allow us to deep six the IRS. This would make the lives of most Americans simpler. It would allow the government to sack a lot of expensive bureaucrats. It would reduce the volume of lies in the country. (Most tax returns are collections of lies, from teensy little ones to whoppers.)

If we demolished the IRS, a majority of us would save money. All the money we now spend for tax advice. H&R Block would lower its flags to half-mast, to mourn its own demise.

Most of us would also save many hours of labor that we put into preparing our tax returns. Millions of dogs and their ribs would rejoice. Because we would no longer kick them for chomping the receipts we cannot find.

Killing off the IRS is not a pipe dream. Imagine if we closed it tomorrow. I mean just closed it. Where would we get the money to run the government? The money we used to get via IRS leeches?

How about we tax consumption? We levy taxes on everything we buy. Period. That is, we replace taxes on incomes with taxes on what we spend.

If you worry about our poor having to pay taxes, you should not. They don’t pay income tax now. Nearly half of Americans pay no income tax. If we had a consumption tax, yes they would pay some tax. But if the tax on necessities was low, they would pay little.

The people who would pay the most would be those who spent the most. Doesn’t that sound like a fair tax system to you?

Now, some would say that crooked folks would avoid paying taxes on what they buy. They’d do it by purchasing stuff under the table — on the black market.

I’m sure some crooks would do that. But do you suppose we might just have the odd crook or two who cheats on taxes in our current income-based tax system?

Sure, we would need to set up mechanisms to stream the consumption tax to Washington, D.C. But they would be tiny, compared to the monster of a machine we call the IRS.

My point is that we could get rid of the IRS. We could cleanse our lives of this monster. We could end the spending of hundreds of billions of hours and dollars on tax reporting.

And we could do it by merely tapping a different artery in the body of our economy.

Under our current system, our big earners pay most of what goes to Washington. If we taxed spending, the picture would be about the same. Big earners are big spenders.

So we would collect the money we need to run the government. But we would save ourselves many headaches, arguments, lies, ulcers, curses, and sleepless nights.

Let’s just say we could deduct all of these things.

And our dogs would sleep better on April nights.

Tom Morgan writes about political, financial, and other subjects from his home near Oneonta. Several upstate radio stations carry his daily commentary, Tom Morgan’s Money Talk. Contact him at tomasinmorgan.com

LETTER TO THE EDITOR: State’s minimum-wage increase, family-leave legislation will cost jobs

Opinion, Subscriber Only

Dear Editor: Studies demonstrate that legislative-imposed minimum-wage programs like the one recently included in Albany’s 2016-17 budget agreement increase unemployment, drive business relocations, and undermine manufacturers’ ability to retain employees. A 2013 Bureau of Labor Statistics study found that a $1 minimum wage increase translates to a 1.48 percent unemployment increase, a 0.18 percent decrease

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Upstate Shredding to acquire Empire Recycling’s Watertown location

Construction, Design & Real Estate, Energy, Environment & Sustainability, Manufacturing & Engineering, Regional News

WATERTOWN, N.Y. — Upstate Shredding, LLC and sister company Weitsman Recycling is expanding into the Watertown market with the purchase of Empire Recycling Corp.’s scrapyard

Kung Fu Tea to open at Destiny USA in June

Construction, Design & Real Estate, Sports, Entertainment & Tourism

SYRACUSE, N.Y. — Kung Fu Tea, a New York City–based tea shop chain specializing in bubble tea flavors, will open a store at Destiny USA

Two North Country resorts awarded loans for capital projects

Construction, Design & Real Estate, Insurance & Financial Services, Law, Accounting & Taxes, New York News, Nonprofits, Regional News, Sports, Entertainment & Tourism

Two Northern New York resorts will use loans totaling $600,000 to help pay for improvement projects. The board of the North Country Economic Development Fund

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